Jack Sharry: Everyone, welcome to WealthTech on Deck. Thanks for joining us. I’m very excited about today’s episode. Typically on our podcast we explore issues and opportunities around the future of financial advice and more specifically, well tech platform strategies and execution. Today is a departure and I have a hunch you’ll find it as fascinating because I do. So much of significant advances we see across the wealth tech space are driven by economics, that’s pretty obvious. And these advances are ultimately driven and delivered to the stories we tell and the stories we hear. So today, we’re going to hear from a friend of mine who works with some of the firms who are listening to this podcast around something he’ll explain called Narrative economics. But before we get ahead of ourselves, let me introduce John Connors. John is the CEO of of the Boathouse Group, a large, Boston based digital advertising and communications firm. So John, my friend, welcome. Thanks for joining us today.
John Connors: Jack. Thank you for having me. Looking forward to our conversation.
Jack Sharry: So John, before we get to defining narrative economics and why it’s so important to advancing wealthtech strategies and execution, why don’t you talk a little bit about your firm and your background? It’s pretty interesting. So fill us in.
John Connors: Well, thanks for the time, Jack, good to connect. So I started boathouse back in 2001. So 21 plus years ago, but before I started it, I had worked originally out of school at big agency in Boston called Hill Holliday, one of the large US agencies, they sold in 97 to Interpublic Group. And I went down to work in New York at McCann Erickson. So I went from working for the biggest in New England, to the biggest in the world. And I hoped that by working for the cokes and the Microsoft’s and the gms of the world, that that BS volume might decline. But I think when I saw the global game, that that BS meter might have actually increased. And so I decided to sort of come back to Boston, come home, and build my own firm. We called it boathouse because the two of us that it started together had wrote at Penn. And if you’ve ever been in a boathouse, it’s a pretty Spartan environment, not a lot of trappings. And we figured the agency business could use a little of that, you know, little Spartan non trappings, no BS kind of environment. And so that was the model and we’ve been building ever since.
Jack Sharry: That’s great was any website still might be I know, things rearranged a bit, but one of my favorite, a couple of favorite comics, one was about no BS. Hear that from your clients. And then pardon the expression we’re on a podcast, you can say whatever you want, but no asshole is allowed. So I’d love that. Love that sort of straight and don’t have to guess. Yeah, kind of approach to communications.
John Connors: Our first 10 years actually, the first line on when you arrived at our website was humbly cutting through the BS, with Bs. And as we sort of increasingly, one more and more corporate clients, you know, they just got more and more concerned about it. But we loved that it was the best sales filter we ever had, because we’ve never gotten the bureaucrats. We only got decision makers. Yeah. And so yeah, and we were fortunate we, you know, our first client was actually Merrill Lynch. So we arrived and started doing small projects for Paula Polito, who’s now at UBS and started, you know, doing digital projects, building websites for them, and then 911 hit, and it was the first sort of really scary opportunity in the marketplace, obviously, haven’t built a business and 911 happening, but Wall Street’s level, advisors stopped calling their clients, right. And so our job was to create a video that would inspire advisors to reach out and call their clients because it wasn’t a sales decision at that time. Sure, your clients wanted to hear from the advisors that their money was safe, and that their goals were intact. And that launched us to total Merrill. And we started building sort of named and designed and launched total Merrill to help sort of with a share wallet strategy back in 2001, under Gorman and Paula and then we lived through 2008, Merrill and made the transition to Bank of America with that whole lot of stories in that process. Yes, yes, I’m sure. And then, so played that out for another seven years. So 15 years that working for Merrill, and really was the patron saint of boathouse and the client that built us because we learned a ton about portfolio theory at the time. Yep. Yeah. And we basically brought portfolio theory to the marketing business and how you manage marketing assets, like you manage assets on a portfolio.
Jack Sharry: Let me frame that if I could. So basically, way back when you started with Merrill before total Merrill was barely an idea, I’m recall that at least the timing of total Merrill, I thought it was a fabulous campaign. Before that, it was more about transactions. And back then there was things like cold calling and stuff that you don’t hear about much these days. And then as things shifted specialities, my recollection around A 911 were really wanted to have more of a relationship not unlike frankly, what where we are now with post pandemic, it’s much less about investing per se, and much more about the experience. And that sort of gets us to the topic for today. Maybe you tie in that what you learned there and how you’re applying it today, because I know you’re, you continue along the same track. And it’s evolved, certainly. And that gets us to narrative economics, maybe if you could thread that needle for us in terms of that connection.
John Connors: So I think a piece of our success or strategy has always been, we always knew it was about more than just the consumer. Right? So Merrill was a classic example, like how you move the advisors to behave differently, how you move clients to behave differently, how you get the market to think differently about Merrill. So we’ve always been good at not just sort of over indexing to one part of the marketplace, but looking at the whole market. And so that’s been sort of a secret sauce underpinning this business for a while. But it got a lot better. When in 2018, this highly regarded economist let’s just say Robert Shiller, who you’ll all know from irrational exuberance and Nobel Prize winner, he wrote a paper on narrative economics. And it was, it’s been sort of a breakthrough for us, because sort of, if you can imagine taking portfolio theory and build a narrative economics on top of it, his point is really a simple one, which is narratives drive economic impact, right. And again, most good CEOs know that most Good leaders know that. But what if you think about economics, they’ve never had narrative data, they had economic data, they had GDP data, they had, you know, employment data, they had sort of housing data, but they never had narrative data to look at causality and correlation related to the economic data. Until all these firms like Google and others index every piece of content in the world. And now we’ll do it every 15 minutes, you can subscribe to the services will index every piece of written and broadcast content, social news, you know, radio, TV, print everything, newspaper, now podcasts and podcasts yet, sorry for that. And you can basically sort of the ability now for him to go back economically, and take historical narrative data, and sort of look at the causality, to economic impacts. So he was looking at things like American Dream narratives, and how that drove the markets. He was looking at Bitcoin narratives and how those drove the market, right. And so what we’re seeing now in our business is CMOs are having a hard time marketing departments are having a hard time and brands are having a hard time. But when we walk in and start talking to CEOs about narrative, and when we talk about to boards about narratives, they light up, right? Because they think in terms of that, and I’ll always use the Tesla example, and I’ll ask the group in the room, can you name Tesla’s tagline? And nobody can, because Tesla doesn’t have a tagline, because they don’t care about brand the way most companies do. They have five or six narratives that they manage, right? And you think about the Elon Musk narrative, and you think about the rocket narrative. And you think about the auto narrative and the solar narrative. He’s a master at putting narratives in the market. And so what we’re doing now with narrative economics, is taking the principles of narrative economics and applying it to CEOs applying it to companies and helping them think about how do you sort of structure a narrative to put it into market so that it has uptake.
Jack Sharry: So in an attempt to summarize, basically, it’s the company story, it’s the company line.
John Connors: it’s the company story. But now we can put science around what you’ve always been amazing at what others sort of, like you have been amazing at, which is the storytelling piece, and how to weave a tale and how to make sure everybody in the room sees what’s relevant for them. And, and I think what marketing has sort of done to itself, not that the consumer isn’t incredibly important, or the core target, but there’s so many other targets and effects that impact the decision. If you don’t connect to all those targets, if you don’t connect to how the government’s driving the narrative, or how the media is driving the narrative, or how the politicians or the regulatory, you know what I mean, if you if you miss one of those on your way to the end consumer, your end target, you know, you can destroy value in your company.
Jack Sharry: So you and I have just some disclosure, John, and I do some volunteer work for a board a local community thing that we’re involved with. In there, we’re doing narrative economics, in the not for profit space. We’ve had some conversations around some folks in our industry around some of the challenges and opportunities of those folks and what they’re trying to do to advance the cause. And as I boil it down, and I’d love to have you comment on this, as I boil it down is there’s sort of two sides of the equation. You got to listen to the marketplace to all facets, all parts of the marketplace. And you’ve got to deliver a story that’s compelling at the end of the day. And to me that’s, that’s being persuasive. In fact, I wrote a book about it. Namely, listen, well then tell a story consistent with what the person just told you. In other words, what they’re trying to achieve with We’re trying to we’re trying to get so I think you agree. But once you put in your own words, and how does narrative economics play out in that way.
John Connors: You know me, like, I’m a big believer in that in the Listen point, there’s a great line, and I can’t attribute it because I just don’t want it now it’s useless. But 98.7% of Americans can hear but only 4%. Listen, you have just way too many people talking without listening. I think that the really interesting part about the way you can listen in the narrative context and the way Schiller sorta would guide you, if you read his book is to go to you know, if you think about you, as a marketer, other folks on the phone, how they think about how they listen, and how good is the data on their listening, so you might listen to social data, or you might listen, anecdotal data to your board, or, you know, boards are famous for always having strong opinions. There’s not many people using tools like signal AI are net based quid to really quantify the listening in a way to say what narratives are in the market? On my brand? What narratives the market on my industry, what narratives do I want to own? And how am I getting from the ones I have, right? So to point on the listening in the story are exactly right. The opportunity now is to have a data set. And again, this is where marketing, I think, in some cases can hurt itself because it takes the datasets, and it’s missed them so narrow, that it’s like a financial adviser telling you, well, your portfolio is getting crushed. But let me tell you about these two stocks that are outperforming in an incredible way like I know that performance is because if that matters, exactly. That’s a challenge of marketers that have now they don’t have a framework to tell the whole portfolio story. They keep grabbing little pieces and trying to make the CEO and the board impressed. And I think where narrative changes that is you elevate, and you can sort of tell a company where they stand it and glimpse where they stand relative to their competitors, what topics they own what they don’t, and you can just go.
Jack Sharry: So one observation, I’d love to have you comment on this is that Axios, which I follow daily, has this thing called Smart brevity, which I recommend to our listeners, they basically talk how to communicate to pierce through given how overwhelmed and inundated we are with information. And none of us and some of the statistics they have, again, I turn you over to Axios to take a look, they’ve studied this in a similar way to what you’re describing John. And that is that there’s so much coming at you and people don’t stick is but very few of us ever get to the end of any story. So when the article you write, but by the time you’re halfway through, you’ve lost most of your audience, because we’re so pressed for time and so much information. It’s what you’re just basically what ends up happening, you give up because he you gotta get on to the next thing. And unless it is compelling early enough on and it’s useful early enough on you’re gonna move on. So what I’m hearing here is basically using the kind of data you’re describing, to create a larger story, or at least a multifaceted story that pucks you to make you want to learn more, is that what we’re talking about here?
John Connors: Yeah, I think it’s both, I think the I think you can create a larger story. But it also you can see how this would work. What we’re doing increasingly is creating more small stories. Yep, more quickly. And then what you’ll sort of the more you studied narrative theory, you’ll see in evaluating contagion rates is those stories. And so we can pump out multiple pieces, see which ones have uptake and lean into those narratives. And they all have to be within the context of the topics we want to own. But the idea now of it again, it does work. Narratives work exactly contagion rate, and the whole second half of his book is about that, because you start to see people like us 2008, as an example, in 2008, everybody turned on Wall Street, right because of what was going on. But everybody defended their advisor. And we were doing the research for Merrill at the time, right. So they people blamed Wall Street for what happened. But regardless, they defended their financial advisor. So what you know, the that’s a classic example of, sort of, if you looked at the umbrella narrative of the larger narrative, you would have said, well, Wall Street financial services, Merrill Lynch, that’s a dangerous place to talk from right now. But if you can tuck in behind the adviser, you see it in health care about how you tuck in behind nurses, right, and sort of build your narrative behind the nursing side rather than the big healthcare side. So even in bad situations, there’s usually a narrative path. And if you can sort of isolate the datasets, you can spot that and then you can sort of move your company and your value through that.
Jack Sharry: So I’m going to reveal something which I probably shouldn’t do, but here goes so I’ve been talking about this concept called UMH unified managed household, I would love to have you comment on this. And as you and I have spoken about this general topic, I’m a guerrilla fighter, and I’m a Street Fighter on this stuff. I don’t have the fancy quantitative analysis. a forum like yours can get their hands on at least we can afford to get our hands on. So it’s we got to be street smart as such what we’re doing. And so I’ve been talking about UMH, good 20-30 years. So it’s been around as a concept, and it LifeYield I’ve been talking about for the past 13 years. And it’s only within literally in the past. The past, I think it’s two months that now articles are popping up all over our new image. Yeah, this unified minutes household and frankly, I’ll be honest, I’ve worked at it, this has not been an accident. And it’s driving the narrative, and all that goes with it. So my goodness, is my gut sense, my street smart sense, hopefully street smart, is that this is good for the client, you know, improves outcome by a third, it’s good for the advisor, because when the clients has more assets, they get more fees. And it’s good for the firm, because frankly, it lowers compliance issues and, and increases revenues. So it’s a win-win all around. So that’s my narrative. I’ve been sticking to it for a long time, it’s finally coming to pass. Am I on the right track? Is this is that narrative economics?
John Connors: Yeah. First off,I would never doubt to Jack, you know that from a starting point. But no, I think, again, a big part of it. Is there a moment in time when the markets open to a narrative? And when it’s not open your narrative? Right? Yes. And so as we we’re sort of in the window of baby boomer retirement and product proliferation and all the pieces, right, yeah, yeah. But I think what you’re seeing now, to your to your credit, I think you were probably ahead of the curve for the five or 10 years that you’ve been talking about it. Right. But now the technology is there. Yeah. Where date is there, where these companies now can see a path to actually presenting UMH? Yes. Now it’s a race to see who’s going to pull it off. Yep. And so they all, you know, every total Merrill example, people have been talking about assets held away from the firm, for as long as time now, I think in this year of personalization, then all the sort of the processing power and the data and the AI. As that all comes together. Somebody’s going to lead in UMH, right. That’s the I think one of the key races right now.
Jack Sharry: Good. We win, you win.
John Connors: I don’t get trademarked.
Jack Sharry: Well, no, no, actually, I’ll be honest, we avoid using that term because they get caught up with another thing that’s a lesser version called you. I’m a unified managed account, the entity thought busy said, well come up with a una because we can do that we can’t do that you MH thing is too complex. Well now because to your point, the technology is such that it can be done. Still hard still, we work with clients every day. It’s a challenge because of all that complexity, but it’s happening. And now that another issue and maybe you make a comment on the condition called FOMO. People fear of missing out is I’m assuming that’s part of narrative economics as well.
John Connors: Yeah, I mean, I think we suffer from the FOMO challenge all the time, because I can, back to the portfolio theory example, imagine if, if you had a portfolio and you just change your favorite asset class every quarter based on you know, whatever was hot in the market, so you ran to Bitcoin, this time, and then you ran to stocks, and then you’re into bonds, and then you went to like, you really have a performance issue. If you think about the marketing equivalent, if the board chairs, son works at Facebook, social media goes, everybody wants social, and then somebody says it’s all about search, then somebody says, it’s all about advertising. And then it’s all about content. And so what we see on the FOMO side is everybody runs to marketing tricks, thinking that there’s some miracle cure, that’s going to make the brand sing. But I always sort of say that CEOs, it’s like everything else in life, there’s no tricks, you know, like, if you don’t eat right and exercise, you’re probably not going to be healthy if you don’t execute a discipline marketing portfolio, and you just chase a formal strategy. And so we can actually show that to clients. And we can show them the last five years of their media mix, and show them that they’re chasing bright lights and CMOS don’t like when we do that, you know, but sometimes they know.
Jack Sharry: Well, this is fascinating. We tried to keep our podcast to half an hour, I’m sure we’re gonna go over on this one, which is perfectly fine with me, but we should at least start to bring it to a close. So what would be your advice to people that are listening in on the podcast that want to apply some things we’ve talked about there for many key takeaways from today, or advice you’d offer in terms of how to succeed and in line with this concept of narrative economics?
John Connors: Yeah, I mean, I think you can find Schiller stuff sort of wide open on the web. So the first piece I would do is sort of just study the application to your business a little bit, you know, and see, second, I would sort of push people to think in terms of narratives plus brand, right? Because I think what you see sometimes, especially in large organizations with the word brand, is it’s this thing that gets owned by one person in the company, why CEOs tend to like narrative betters because they see that as Then the whole company owns, you know, ops tech, everybody’s responsible for narrative. And I think to the extent that brand becomes too verticalized and too precious to owned by one person that gets too narrow. And then the third piece to me is lean into those datasets. Like you can just imagine, if you had that JP Morgan guy to the markets on your desk every day, and you never opened it, you would be ever you would be at a disadvantage if all that data existed. Equally, these narrative data sources are not too expensive. Now you can get them at 2025 grand some, you know what I mean. So you can look at your brand in the context of all the industry narrative really crisply now. And I think, to your point, if you can use that to listen, and you can use that to tell a better story. And you can make sure that that story is in track, whether it’s resonating with those key influencers, whether it’s the media, whether it’s the government, whether it’s in consumer, whether it’s b2b, you’ll see the value implications immediately.
Jack Sharry: Just a comment that I’ll add here, for those of you that get what John’s talking about, John, if they wanted to reach out with a book, what’s the best way to get in touch with you?
John Connors: You can always reach me my email, which is J. Connors at boathouseinc.com.
Jack Sharry: Which I highly recommend you check it out, check out their website, I’ve suggest this to many friends and colleagues in the business, if you want to have a good read very good content about how to position brand market your firm. The other thing I’ll add, this is just another secret revealed, I’ll tell you what I do because LifeYield is small, so we can’t afford what you’re describing in terms of datasets. So basically, what I do is I have conversations every single day with industry leaders, and I read everything I can about trends, and I synthesize what I read, and then make my best attempt to then fulfill on what I listen for as an opportunity and build my story. By the way, the story gets built over time. It’s not something that it’s one and done. It continues to evolve. So for those of you who are looking for the less costly and more seat of the pants version, there you have it. That’s what I do each day. So I’ll share that with you.
John Connors: I’ll jump in on that Jack, you there’s another layer that you naturally do as well, which is the win-win. Yeah, a lot of people have the what how do I win, but I think it’s another layer to the narrative piece, which is, where’s the win-win?
Jack Sharry: Yeah, and I’ll reinforce that. And I do talk about this, not that I’m plugging my book, you can read it if you’d like it’s on amazon.com. But one of things I learned early on in my career was a wholesaler to start and I was calling on advisors. And I found if I showed them how to when they would sell my product. And my product. Frankly, it was complicated. It was hard to understand, you know, so on. So in fact, I built my career doing seminars and talking about to their clients, where I did a financial planning seminar about how to have a secure retirement, that was the seminar. And frankly, we got hundreds of people to the seminar because it basically told them what to do. And then I turned it back to the adviser and they went and did it. And oh, by, by the way, my product got sold in the process appropriately. And when and that’s another you’re right to point that out. That is I’m always thinking that how do I make sure the other side of the conversation wins. And when they win? Frankly, I win. It’s how it goes. So John, we need to close up here. This has been a blast. I knew it would be it’s better than I expected. So what’s one thing we as we ask our guests on each of our podcasts? What’s something about you that’s not part of your workday life that you’re particularly passionate about? Interested in excited about? What do you do away from work?
John Connors: So my long term goal is a year in Vermont, living off the grid 100% Sustainable off the grid year in Vermont. So we’re sort of in the process now of sort of doing that we’re planning, we’re buying the land, we’re planning the sort of where the farms going, where the metal is going, where the animals go, where the vegetables roots go. So I am 100% insane. Trying to is your wife in honors, she’s in on it. It’s a one on challenge of whether we can live off the grid for one. That’ll be the goal.
Jack Sharry: Good. Good for you. I’m kind of doing that I’m in Vermont as we speak and not quite off the grid, I have to admit, but close.
John Connors: So I might have to my own bourbon for that year.
Jack Sharry: There was some locally made bourbon we should try. But anyway, I digress. So I want to thank our listening audience as we wrap up, our subscribers keep growing and word of mouth seems to be accelerating. We’re over 1000 folks that are listening to this podcast. So thank you for that. We appreciate it. If you enjoyed the podcast, please rate review, subscribe and share what we’re doing here at WealthTech on Deck. We are available wherever you get your podcasts. So John, thanks again. It’s been a real pleasure and I look forward to our conversation.
John Connors: Thanks for the talk, Jack.
Jack Sharry: Yeah, thank you.